1) when an investor purchases a corporate stock, he purchases the right to receive a
specified fixed stream of income from the corporation for a specified number of years.
2) if a country is characterized as having a single homogenous culture, then its national
culture also is homogenous and not a mosaic of subcultures.
3) foreign direct investment can make a positive contribution to a host economy by
supplying capital, technology, and management resources that would otherwise not be
available and thus boost that country’s economic growth rate.
4) while a government may commit to taking corrective action in return for an imf loan,
internal political problems may make it difficult for a government to act on that
commitment.
5) source effects and country of origin effects are always negative.
6) many nations follow the worldwide principle that they have the right to tax income
earned outside their boundaries by entities based in their country.
7) the central message of collectivism is that individual economic and political
freedoms are the ground rules on which a society should be based.
8) the foreign corrupt practices act outlawed the paying of bribes to foreign government
officials to gain business.
9) political opposition to the adoption of a free trade regime typically comes from those
whose jobs are most at risk.
10) china, deliberately keeping its currency value low against the u.s. dollar in order to
sell more goods to the united states, and thus amass a trade surplus and foreign
exchange reserves, is viewed by critics as following a:
a.zero-sum game
b.neo-mercantilist policy
c.positive-sum game
d.free trade policy
11) economic problems during the great depression were compounded in 1930 when the
u.s. congress passed the _____, aimed at avoiding rising unemployment by protecting
domestic industries and diverting consumer demand away from foreign products.
a.smoot-hawley act
b.anti-dumping act
c.helms-burton act
d.d’amato act
12) the _____ represents the interests of member states and is clearly the ultimate
controlling authority within the eu.
a.european parliament
b.european commission
c.european council
d.court of justice
13) an act, as simple as shaking hands when meeting new people is an example of:
a.values
b.symbolic behavior
c.mores
d.social stratification
14) according to the concept of economies of scale:
a.as plant output reduces, unit costs decrease
b.as plant output expands, unit costs increase
c.as plant output reduces, unit costs remain static
d.as plant output expands, unit costs decrease
15) this refers to impact a firm’s pricing strategy in one market may have on its rivals’
pricing strategy in another market.
a.multipoint pricing
b.experience curve pricing
c.predatory pricing
d.competitive pricing
16) the emphasis on individualism in the united states results in all of the following
disadvantages except:
a.managers tend to develop good general skills but lack the company-specific
experience
b.difficulty in building teams within an organization to perform collective tasks
c.executives are not exposed to different ways of doing business
d.difficulty to achieve cooperation both within a company and between companies
17) according to porter, all of the following are broad attributes of a nation that shape
the environment in which local firms compete except:
a.factor endowments
b.supply fluctuations
c.relating and supporting industries
d.firm strategy, structure, and rivalry
18) which of the following is a drawback of the polycentric approach to staffing?
a.firms are likely to suffer from cultural myopia
b.host-country nationals are vulnerable to cultural misunderstandings
c.this approach increases the cost of value creation
d.host-country nationals have limited opportunities for advancement beyond senior
positions in their subsidiary
19) a firm that is facing both strong cost pressures and strong pressures for local
responsiveness should follow a _____ strategy.
a.localization
b.global standardization
c.international
d.transnational
20) a draft:
a.is a document requesting payment
b.is the same as a letter of credit
c.is a reciprocal buying agreement
d.gives title to shipped goods
21) which of the following selections accurately depicts the levels of economic
integration from least integrated to most integrated?
a.economic union, common market, customs union, free trade area, and full political
union
b.common market, economic union, full political union, free trade area, and customs
union
c.free trade area, customs union, common market, economic union, and full political
union
d.full political union, free trade area, common market, customs union, and economic
union
22) all of the following statements regarding the effects of exchange rates on
international portfolio diversification are true, except:
a.the volatile exchange rates associated with the current floating exchange rate regime
increase the risk-reducing effects of international portfolio diversification
b.floating exchange rates introduce an additional element of risk into investing in
foreign assets
c.adverse exchange rate movements can transform otherwise profitable investments into
unprofitable investments
d.uncertainty engendered by volatile exchange rates may act as a brake on the otherwise
rapid growth of the international capital market
23) vertical integration may raise a firm’s cost structure for all of the following reasons
except:
a.the greater the number of subunits in an organization, the more problems coordinating
and controlling those units
b.the firm that vertically integrates into component part manufacturing may find that
because its internal suppliers have an active customer, they lack the motivation to be
more efficient
c.vertically integrated firms have to determine appropriate prices for goods transferred
to subunits within the firm
d.it makes planning, coordination, and scheduling of adjacent processes more difficult,
as compared to buying from independent suppliers, particularly with just-in-time
inventory systems
24) explain the product life cycle theory and its connection with fdi.
25) what is theodore levitt’s contribution to international business?
26) failure of the spouse to adjust was the top reason given for expatriate failure in
american firms, the only reason given for expatriate failure in european firms, and the
number five reason given by japanese firms. discuss the reasons behind the difficulties a
spouse faces in adapting to a new country.
27) discuss the two schools of thought on exchange rate forecasting.
28) discuss the type of firm that uses the worldwide product division structure. what are
the main strengths and weaknesses with this type of structure?
29) describe a typical international trade transaction.
30) discuss collectivism. what ideals does the philosophy support? where did the
philosophy start? how does collectivism exist in the modern world?
31) explain the connections between economies of scale, first-mover advantages, and
trade patterns.
32) what is the role of government in porter’s theory?
33) explain the role of values and norms in culture.